Redundancies in Singapore highest since 2009

Amid softer economic conditions, redundancies in Singapore continue to occur in local corporate sectors.

In fact, the last quarter has seen the highest number of workers made redundant in the first quarter since 2009.

This was according to a new Ministry of Manpower (MOM) labour market report.

In the first quarter of 2016, 4,710 redundancies were found to have been made in the island-nation.

This figure was still higher than the same period last year (3,500) and the highest recorded first quarter redundancies since 2009.

MOM added that "redundancies are expected to rise in sectors affected by weak external demand".

It stated that it "will continue to work closely with tripartite partners to provide employment support and help displaced locals re-enter employment, including through the recently announced Adapt and Grow initiative".

By sector, the bulk of the redundancies this year came from the services sector (54%).

This was mainly in professional services (13%), wholesale trade (11%) and financial services (9.1%) - followed by manufacturing (38%) and construction (8.2%).

Similar to previous reports, professionals, managers, executives and technicians (PMETs) represented the large majority of layoffs at 71%, partly reflecting their higher share among the employed.

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This was followed by production and transport operators, cleaners and labourers (18%) and clerical, sales and service workers (11%).

When it comes to short-week or temporary layoffs however, PMETs were among the least affected (22%) while the bulk of those affected were production and transport operators, cleaners and labourers (69%).

In Q1 2016, 920 workers were placed on short work-week or temporary layoff, higher than Q4 2015 (810) and Q1 2015 (800).

Those affected were mainly from manufacturing (57%), followed by services (28%) and construction (15%).

While most workers were placed on short work-week (88%), the rest were temporarily laid off (12%).

In addition, the report found that only 46% of residents who were made redundant in Q4 2015 managed to re-enter the workforce by March 2016.

This was lower than Q4 2015 (50%) and Q1 2015 (57%).

In fact, Q1 2016 saw the lowest rate of re-entry into employment since June 2009 (43%).

"The decline in re-entry rates was broad-based across all age, occupational and education groups, particularly for those with post-secondary (non-tertiary) and diploma and professional qualifications," the report stated.

In line with that, resident long-term unemployment rate increased from 0.5% in March 2015 to 0.7% in March 2016.

The report found that the share of long term unemployed residents among unemployed residents also rose from 21% in March 2015 to 26% in March 2016, the highest of the March periods since 2005.

"The increase in long term unemployment rate was observed among residents with secondary and below and diploma and above qualifications, as well as aged 30 and over," it stated.

Despite this, unemployment declined among residents (2.9% to 2.7%) and citizens (3.0% to 2.6%) over the same period and the overall unemployment rate remained unchanged at 1.9% in March 2016, compared to December 2015.

Around 60,400 residents, (including 50,800 Singapore citizens) were unemployed in March 2016. This was lower than 64,600 (residents) and 57,900 (citizens) in December 2015.

This might be due to the increase in employment in Q1 2016 to 13,000. While this was lower than the 16,100 in Q4 2015, it was higher than the -6,100 in Q1 2015.

Additionally, the report found that as vacancies continued in a downward trend since the beginning of 2015, the job vacancy to unemployed ratio declined.

The seasonally adjusted vacancies continued to decline from 53,900 in December 2015 to 50,000 in March 2016 bringing the seasonally adjusted ratio of job vacancies to unemployed persons down to 103 openings per 100 seekers in March 2016.

This was significantly lower compared to 112 in December 2015 and 139 in March 2015 and was found to be the lowest since June 2012 (98).

This decline was found to be broad-based across industries with the largest decline in community, social and personal services (-3,300). This was followed by manufacturing (-1,900), professional services, and accommodation and food services (both -1,600).

On the bright side, information and communications saw increases compared to a year ago, mainly among PMET job openings (+200).

The report stated: "Half of the vacancies in March 2016 were for PMETs (24,600 or 50%), followed by clerical, sales & service workers (13,700 or 28%) and production & transport operators, cleaners & labourers (10,900 or 22%)."

At the same time, the report noted that the seasonally adjusted recruitment rate remained unchanged at 2.4%, while resignation rate decreased to 1.8% in Q1 2016, after holding steady at 1.9%.

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